Camera IconThe development, 15km from FMG’s Kings ore processing facilities, has an expected mine life of between 10 and 15 years.Picture: WA News

Fortescue Metals Group will push ahead with a $US287 million ($417 million) extension of its giant Solomon iron ore hub in the Pilbara.

The Andrew Forrest-chaired miner today gave the green light to develop the Queens Valley mining area, which will maintain production of its low-alumina Kings Fines product.

Fortescue has been trying to shore up demand by moving to produce higher-grade ore as its lower-grade products fall out of favour with Chinese buyers facing environmental restrictions on steel mills.

The development, 15km from FMG’s Kings ore processing facilities, has an expected mine life of between 10 and 15 years.

“Fortescue’s integrated operations and marketing strategy defines a product portfolio that maximises value from the Fortescue orebodies over the long term, ensuring the continued delivery of returns to shareholders,” chief executive Elizabeth Gaines said.

“The Queens mining area development will maintain our highly valued Kings Fines low-alumina sinter fines product which supplies Fortescue’s key customers in China as well as in Japan and Korea.”

FMG will spend $US10 million to advance the plans this financial year, ramping up captial costs to $US151 in FY20 and $US98 million in FY21.

Development will include construction of a hydraulic barrier wall and moving Solomon’s mobile maintenance facilities closer to the Queen’s operation to cut travel distances, lower operating costs and provide access to additional tonnes near the Kings processing plant.